Bridgeline Digital Inc. (NASDAQ- BLIN)
Price August 20, 2012-$1.24
.We have been watching BLIN for a long time—2009. It has always traded at a large discount to our valuation but we think that will change over the next year.
Their last quarter (6/30/2012) sales were down 1% from the prior year to about $6.4 million as they transition their business to iAPPs which grew 35% to 4.2 million, gross margins were 56% and they lost $.02 per share ($.3 million) the same as last year. They broke even on a Non-GAAP basis. Their net cash position is negative $3 million or $.24 per share which is reflected in our valuation.
From their latest press release (August 14th):
“On June 5, 2012 we announced our strategic alliance with UPS Logistics to offer B2B and B2C eCommerce web stores with an end-to-end offering comprised of our iAPPS eCommerce solution and UPS logistics and fulfillment services.
We also completed the acquisition of MarketNet, Inc., an award-winning interactive technology company based in Texas, expanding our North American presence into the South Central U.S. market.
Earlier today we announced iAPPS ds (distributed subscription). iAPPS ds has been specifically developed for large franchise networks and multiple dealer organizations to improve the website tools they extend to franchisees and local dealers to effectively attract, communicate with and retain local customers while enabling superior oversight of corporate branding and content messaging. Franchisees and local dealers would be required to pay a monthly subscription fee for the service.
Bridgeline Digital is pleased to announce that it recently signed a multi-year iAPPS ds agreement with a nationally recognized franchise, which plans to have up to 4,000 of its franchises directly license iAPPS ds. Bridgeline Digital expects to announce more details about this specific customer in fiscal 2013.”
Two of BLIN’s management own just under 10% of BLIN’s shares.
They are projecting $26.5 million in sales this year and to be Non-GAAP profitable. With a market cap of about $20 million and 56% margins, we think this is a BUY even though the discount to our valuation is only 45%.
Average trading volume is about 96,000 shares a day. There are about 15 million shares outstanding. The stock has traveled between $.47 and $3.24 over the last 12 months.
About Bridgeline Digital
Bridgeline Digital is developer of the award-winning iAPPS(R) Web Engagement Platform and related interactive solutions.
The iAPPS platform deeply integrates Web Content Management, eCommerce, eMarketing, and web Analytics capabilities within the heart of mission critical websites or eCommerce web stores. iAPPS enables customers to enhance and optimize the value of their web properties. Combined with award-winning interactive development capabilities, Bridgeline helps customers cost-effectively accommodate the changing needs of today’s rapidly evolving web properties; allowing them to maximize revenue, improve customer loyalty, enhance employee knowledge, and reduce operational costs.
The iAPPS product suite is delivered through a Cloud-based SaaS business model, whose flexible architecture provides customers with state-of-the-art deployments that provide maintenance and daily technical operation and support; or via a traditional perpetual licensing business model, in which the iAPPS software resides on a dedicated server in either the customer’s facility or Bridgeline’s co-managed hosting facility.
Bridgeline Digital is headquartered near Boston with additional locations in Atlanta, Baltimore, Chicago, Denver, New York, Philadelphia, Tampa, and Bangalore, India. Bridgeline has hundreds of customers ranging from middle market organizations to divisions within Fortune 1,000 companies that include: L’Oreal, Sun Chemical, Parametric Technologies Corp, Blue Cross Blue Shield, Novartis, Shaw Flooring, Endo Pharmaceuticals, Guardian Life, Tosoh, Dover, ViaWest, PODS, AARP, Cadaret Grant & Co., CFO Magazine, and the American Academy of Pediatrics.wireless apps as a fundamental part of their daily lives. Government agencies utilize TCS’ cyber security expertise, professional services, and highly secure deployable satellite solutions for mission-critical communications..
I've been looking at BLIN for a while and figure that insider buying is pretty much key for what direction this stock is going. I'm not buying right now and might miss the best entrypoint, but definitely buying after insiders purchase again.